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Morgan Stanley to Buy E-Trade for $13B

nytimes.com

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Re: Morgan Stanley to Buy E-Trade for $13B

#111

Post by hcknwscommenter »

lordnacho wrote: post #104
hcknwscommenter wrote: post #97

Earlier quoted context omitted.

I agree that HFT don't buy order flow in order to make trades execute better for retail investors. They buy order flow in order to make money. The retail order flow is, as you say, non-toxic. That is, HFT can reasonably expect to make money with the data and not get rolled over. The question then becomes, who is paying HFTs and why. The highly simplified answer is that HFTs are allowed by the regulatory agencies/exch…

No, if the flow is non toxic it's easy to make money from. You pocket the spread and eventually you do the same on the other side to get flat. No shenanigans required.

Nothing you state above contradicts anything I stated. I explicitly stated that non-toxic flow is easy to make money from. I explicitly said that you make money by capturing some of the spread. You say "pocket the spread" which is simply wrong. No market maker gets the entire spread. My point is that there are many versions of "front-running" that are not "shenanigans." You seem confused as to how all this works.

Re: Morgan Stanley to Buy E-Trade for $13B

#112

Post by hcknwscommenter »

sseveran wrote: post #109
hcknwscommenter wrote: post #99

Earlier quoted context omitted.

If you want to define front-running that way, then I agree HFTs don't front-run. But they do step in between buyers and sellers. If you want to call that something else, shrug.

Stepping in between buyers and sellers is called market making. They smooth supply and demand across time. Also I don't define front running that way, FINRA does. https://www.finra.org/rules-guidance/rulebooks/finra-rules/5...

Your link contradicts your definition.

Re: Morgan Stanley to Buy E-Trade for $13B

#113

Post by basch »

hakfoo wrote: post #102
murph-almighty wrote: post #62

Earlier quoted context omitted.

>I am somewhat surprised nobody offers an abstracted savings account, that handles 401k, IRA, HSA, paying rent and bills, and access to credit. I think it'd be complicated to regulate from a risk perspective. Checking and savings accounts get insured by the FDIC, how do you insure a large pile of money invested practically everywhere in varying risky scenarios? You'd need to at least create a boundary between "FDIC-i…

I think there's a related product out there. Think of the traditional baby boomer era story-- "Dad brings home the paycheque, Mom does the budget." Give me Mom as a service. Don't let me touch my full salary, just what's left after a responsible adult has done with it. Let me plug in every account I have, and set up rules like * Pay the rent on the first cheque of the month and the electric company on the second * Pa…

Exactly. That is exactly what I am describing. What I would add is a built in line of credit that allows rent to be paid, bills to be paid, without a paycheck being deposited, and without needing to withdraw money from investments, money market etc. This would basically eliminate the need to keep cash in a checking account. Once per period, whatever that period is, money would move from savings to the line of credit. This line of credit would be accessible as a bank account, and as a credit card, to pay bills.

What needs to be displayed to you is some equivalent to cash flow or net income combined with a budget. Knowing you spend x on rent and y on food a month, are you on track to keep cash flow positive?

Re: Morgan Stanley to Buy E-Trade for $13B

#114

Post by celticninja »

gonehome wrote: post #79
murph-almighty wrote: post #62

Earlier quoted context omitted.

>I am somewhat surprised nobody offers an abstracted savings account, that handles 401k, IRA, HSA, paying rent and bills, and access to credit. I think it'd be complicated to regulate from a risk perspective. Checking and savings accounts get insured by the FDIC, how do you insure a large pile of money invested practically everywhere in varying risky scenarios? You'd need to at least create a boundary between "FDIC-i…

Haven Money was an attempt at this (startup a friend/former coworker started to tackle this), but they recently sold to credit karma. https://havenmoney.com/ It was a cool idea - basically they'd auto invest some portion into a total market index, pick the best rates for things in your 401k, etc.

And credit karma was itself acquired recently.

Re: Morgan Stanley to Buy E-Trade for $13B

#115

Post by lordnacho »

hcknwscommenter wrote: post #111
lordnacho wrote: post #104

Earlier quoted context omitted.

No, if the flow is non toxic it's easy to make money from. You pocket the spread and eventually you do the same on the other side to get flat. No shenanigans required.

Nothing you state above contradicts anything I stated. I explicitly stated that non-toxic flow is easy to make money from. I explicitly said that you make money by capturing some of the spread. You say "pocket the spread" which is simply wrong. No market maker gets the entire spread. My point is that there are many versions of "front-running" that are not "shenanigans." You seem confused as to how all this works.

No need to get personal. I guess you could use a less loaded term than front-running. Or at least qualify what you mean when you put it in "here".
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